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What's in a Maiden Lane name?

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“The name ‘Maiden Lane’ comes from the Federal Reserve Bank of New York’s address on Maiden Lane in lower Manhattan,” an AIG spokesman said.
AP Photo

Amid all the bizarre financial terms and complicated jargon floating in the mainstream media during the recent financial bailouts — think “credit default swaps” — one of the biggest head scratchers has been the name “Maiden Lane III.”

That’s the financing entity created by American International Group and the Federal Reserve Bank of New York to buy securities, and it’s a big recipient of federal bailout money.

But why Maiden Lane? And is there a Maiden Lane II and a Maiden Lane I?

Suspicious that somebody at AIG had named the financing vehicle after the address of his mansion in the Hamptons or the street where he grew up, we asked AIG spokesman Nick Ashooh what’s up with the strange moniker.

Turns out, the name didn’t come from AIG at all but, rather, from the Fed. And it doesn’t have anything to do with the posh homes in the Hamptons. “The name ‘Maiden Lane’ comes from the Federal Reserve Bank of New York’s address on Maiden Lane in lower Manhattan,” Ashooh said. “Maiden Lane I, I understand, was Bear Stearns. Maiden Lane II is AIG’s securities lending facility, and Maiden Lane III is AIG’s credit default swap facility.”

The New York Fed’s address is officially 33 Liberty Street in downtown Manhattan, but the other side of the block is Maiden Lane, which runs from Broadway to FDR Drive.

There’s even a website for the original Maiden Lane, at www.maidenlanellc.com, which describes “a limited liability company formed to facilitate the arrangements associated with JPMorgan Chase & Co.’s acquisition of Bear Stearns Companies Inc.”

The Fed name “Maiden Lane” continues a long tradition of totally bizarre names for special financial vehicles. Remember Enron? There, executives created a host of odd names for their so-called special purpose entities, including Raptor I, Raptor II, Raptor III and Raptor IV; Chewco, named after the wookie Chewbacca from “Star Wars”; and Jedi, named for that movie’s heroic space knights.